Christy Clark promised, during the Liberal Party leadership campaign, to increase the minimum wage, and now she has. The Liberals have long said a minimum wage hike would hurt first-time job entrants, so some people are asking, "why they are raising the minimum wage now?" A better question might be, "why did they wait so long?"
Raising the minimum wage is a no-lose political move. That's because conventional wisdom says a higher minimum wage will 'do something' to help the poor. Let's face it - governments can't free themselves from the pressure of public opinion, no matter how misguided. As Milton Friedman explained in A Conversation, in a representative democracy, if 80 per cent of voters believe in witchcraft, then politicians have to believe in witchcraft. The idea that minimum wages help the poor is today's witchcraft.
There are a couple of other reasons why increasing the minimum wage is good politics. The people hurt by the minimum wage hike, first-time job entrants, like young people and new immigrants, tend not to vote. Better still, hiking the the minimum wage takes the issue away from the NDP.
When government fixes prices above the level they would naturally flow to, it increases supply and reduces demand. When government fixes a high minimum wage, more people with low labour skills try to enter the labour market but the demand for low-skilled workers falls. Increasing the minimum wage is like kicking rungs off the bottom of the wage ladder. It will make it even harder for young people and other first-time job entrants to find jobs and start moving up the income scale.
Poor people in B.C. are poor because they are not working, not because they earn the minimum wage. The way to reduce poverty is to improve conditions for job creation, not well-intentioned policies that might be good at election time but don't work to reduce poverty.
If Miss Bader is so concerned about small business she might want to go work for some the the stupid wages they offer.
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